AMGV NEWS RELEASE:
Results of Operations
From January 1, 1998 through March 31, 1998 the Company's revenues were $73,193
compared with $297,849 for the same period a year ago. The Company had a loss of $54,363
for this period compared to a loss of ($42,533) the same period a year ago. The loss was due to a
decrease in revenues from the Company's decision to sell its products only through Wal-Mart
Online (www.Wal-Mart.com) and not in Wal-Mart's retail stores. During this period, Wal-Mart
Online was in its development stage and there was essentially no marketing for Online products.
Wal-Mart Online expects to complete its web page development in six more months. Even though
the Company had a significant reduction in revenues, it placed in the top five vendors for
Wal-Mart Online. Management's decision to sell only through Wal-Mart Online is due to the fact
that the Company will experience greater long term benefits than to continue to expand into
additional Wal-Mart retail stores. Some advantages from selling only through Wal-Mart Internet
site is that Wal-Mart pays the Company within fifteen days from the time the product is shipped.
Other benefits from selling through Wal-Mart Online rather than through their retail stores is that
the purchaser has only allowed fifteen days to return the product, the warranty begins the day the
purchaser receives the product and the Company has accurate records on when the product is
sold and who the purchaser is. Selling Online also provides a "just in time" inventory method that is
very beneficial for computer manufactures. The components are not purchased until the order is
placed from the customer. This method of inventory reduces expenses of personnel and
warehousing, nullifies the guaranteed sale provision and shields the Company from the
extraordinary depreciation of costs that are so prevalent in the computer industry.
Management is also confident that the change to selling through Wal-Mart Online and not through
their retail stores is that Wal-Mart Online plans to feature a "Build to Order" (BTO) computer
system. The BTO concept has been one of the reasons that Dell Computers and Gateway
Computers have been successful. Wal-Mart Online has given the Company an exclusive to use
only the Company's computers in their BTO program. The Company has the opportunity of
growing with a new division within the largest retailer in the world.
Working Capital and Capital Resources
Working capital at March 31, 1998 (current assets less current liabilities) totaled $35,565
compared with $319,038 at March 31, 1996. The decrease in working capital was due to a
decrease in revenues and accounts receivables while carrying forward unpaid accounts payable.
The Company is developing its own web page to sell directly to the public as well as selling
through Wal-Mart's web page. Selling directly to the public will be done through credit cards and
will essentially work as factoring but at a lower cost. If the Company is successful with its own
web page sales, it will greatly reduce the need for additional financing needed for day to day
operations. The Company is seeking capital to meet its marketing needs.
Recent Filings: Dec 1997 (Qtrly Rpt) | Jul 1998 (Annual Rpt) | Aug 1998 (Qtrly Rpt)
More filings for AMGV available from EDGAR Online
|
